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Foreword

ethanol and Di Methyl Ether (DME) are emerging as
alternative liquid fuels for transportation. While methanol
Mcould be used directly or, blended with gasoline, DME is
suitable for Diesel engines.
The use of methanol and DME – a dehydrated form of methanol
was initially fuelled by their excellent burning characteristics and
lower GHG emission. With price advantage of natural gas, methanol
and DME penetrated into the liquid transportation fuel market.
Subsequently, coal has also been used, particularly in China, to
produce methanol and DME for fuel application.
Till 2012, global methanol production was much less than the
installed capacity, but during the last few years, the demand has
increased and many new facilities are coming up around the world. It is expected that by
2020, the production of methanol will exceed 100 Million Tonnes. The present demand for
DME is of the order of 5 Million Tonnes Per Annum, which is expected to grow by about 15%
per year during the next few years. At this time, the major use of DME is for blending with LPG
but the use as diesel substitute is expected to raise the requirements many folds.
Unlike gasoline or diesel, which are mostly produced from petroleum crude, methanol and
DME could be produced from biomass via syn gas, or via reforming of bio gas. With increasing
concern about GHG emission, from energy usage, the fuels produced from renewable sources
are increasingly favoured over the non renewable sources. From biomass virtually carbon
neutral fuel is possible to be produced. Further, the large methanol/DME plants based on fossil
fuels could easily reduce the impact to the environment by capturing the carbon produced
during the processing of the hydrocarbon source to methanol/DME.

However, the current production of methanol is largely based on fossil sources with only
between 1-2 % of the total methanol being produced from biomass.
In India all the methanol plants are based on natural gas or naptha. Although there is great
demand for methanol in India, the availability of natural gas and price of naptha along with
the low import price of methanol, is preventing building of new plants.
In Indian context, however, the real success will be considered when Methanol will be produced
by using low grade high ash coal or utilizing the high concentrated CO stream coming out of
2
factories or plants e.g. large power plant, steel plant etc.
Towards getting a status paper for consideration and evolving a road map for our country, this
survey report broadly covered the information on the aspects viz. potential availability of high
ash coal and biomass for methanol & DME production; R & D efforts in the sector–National &
International; status of available technologies; evaluating feasibility; issues and challenges &
areas for improvement in the production technology; setting R&D priorities, etc.
I hope that survey report will be useful in exploring the avenues for production of Methanol &
DME in India towards furthering the energy security of our country.

H. S. Karangle
Chairman- Experts Group
Production of Methanol & DME